Judgments That Shaped the Landscape for Customs' New Baggage Rules In Union Budget 2026-27

The move is significant keeping in mind the rising disputes between passengers and Customs Department landing before Courts, mostly concerning the erstwhile Baggage Rules 2016, permissible limits of valuable goods that one may bring to the country, the procedure followed by Customs officers while dealing with suspect red channel cases, etc.

Here's a snapshot of recent disputes and the course our Judiciary has taken:

Personal Jewellery

Gold jewellery being brought into the country by international travellers has been one of the central issues before Courts recently.

The erstwhile Baggage Rules 2016 framed under the Customs Act 1962 ensured that every passenger entering India passes through a Customs check. It allowed duty-free clearance of certain items, including used household articles, professional equipment, and personal effects to eligible passengers.

The erstwhile Rules permitted any jewellery of 20 grams with a value cap of Rs. 50,000/- in case of a man and 40 grams with a value cap of Rs. 1,00,000/- in case of a woman to be cleared free of duty.

In Qamar Jahan v. Union Of India, Represented By Secretary, Ministry Of Finance & Ors. (2025), the Delhi High Court expressly asked the Customs authorities to review the Baggage Rules, 2016 and revisit the amount of gold or gold jewellery that can be carried by a person travelling to India by air.

“The market rate of gold at present, where forty grams of gold would be costing much more the value cap of Rs. 1,00,000/- prescribed under Rule 5 of Baggage Rules. With the maximum limit of Rs.1,00,000/-, the gold that could be purchased may only be around 15 grams,” it had said.

With the new Baggage Rules 2026, which came into effect from midnight (February 02, 2026), the government has raised the limit for passengers (resident or a tourist of Indian origin) bringing duty-free imported goods into India from ₹50,000 to ₹75,000.

The changes seem to stem from the following cases:

In Directorate of Revenue Intelligence and others vs. Pushpa Lekhumal Tulani (2017), the Supreme Court held that the bona fide jewellery of a passenger carried for personal use is not dutiable goods.

In Vigneswaran Sethuraman vs. Union of India (2014), the Kerala High Court dealt with the applicability of the Baggage Rules, 1998 and their impact on jewellery borne by a passenger on his person. It had ruled that it was not necessary for a passenger to declare the gold chain “worn” by him.

The Delhi High Court in Saba Simran vs. Union of India & Ors. (2024) held that 'personal jewellery' of a person coming to India, which is not found to have been acquired on an overseas trip and was always a used personal effect of the passenger, would not be subject to duty under the Baggage Rules.

In Thanushika vs. The Principal Commissioner of Customs (Chennai) (2025), the Madras High Court ruled that Baggage Rule apply only to the baggage carried by an international traveller and the Rules cannot be extended to articles like jewellery, “carried on the person” of a traveller.

Personal Jewellery of Foreign nationals

The new Baggae Rules have also increased duty-free limit for foreign tourists from ₹15,000 to ₹25,000. Here are a few cases pertaining to jewellery brought to India by foreign nationals.

In Nathan Narayansamy v. Commissioner of Customs (2024), the Delhi High Court held that Rule 5 of the Baggage Rules apply to an Indian national upon his return to the country after having lived abroad for the period prescribed and not to a foreign national.

In Rajendra S. Bajaj Versus The Union of India (2024), the Bombay High Court quashed the proceedings initiated by the Customs for seizing the gold chain and gold pendant embedded with 12 diamonds from a US national, after observing that he was a high-income person and could afford to possess such expensive jewllery for 'personal use'.

In Luvleen Maingi v. UoI (2024), the Delhi High Court dealt with a case where the gold chain and kara of a Thai national were confiscated by the Customs on the ground that exemption from duty is confined to personal effects, exclusive of jewellery, whether it be personal or otherwise.

The Court however held that “personal jewellery” worn to India by a foreign national is not subject to Customs duty.

In Farida Aliyeva v. Commissioner Of Customs (2024), the Delhi High Court reinforced its stand that the 'personal' gold jewellery of a foreign national coming to India is not subject to duty, and ordered the Customs department to release an Azerbaijan national's belongings.

In Anjali Pandey v. Union Of India And Ors (2025), the Delhi High Court came across another case where a Thai national's gold bangles were seized by the Customs Department, contending that whenever any foreign tourist carries jewellery, the same ought to be declared.

The Court then directed the Customs to make a distinction between 'jewellery' and 'personal jewellery', while seizing items for violation of the Baggage Rules. It was held that foreign nationals coming to India need not declare to the Customs Department their gold jewellery which they are carrying for bonafide “personal use”.

In MR Makhinder Chopra Commissioner Of Customs New Delhi (2025), the Delhi High Court held that the Baggage Rules have limited application on foreign tourists coming to India.

In Amirhossein Alizadeh v. The Commissioner Of Customs & Ors. (2025), the Delhi High Court ordered the Customs Department to release the silver-coated gold chains of an Iranian national, which were confiscated on his arrival in India almost three years ago.

In Gopika Vennankot Govind v. Union Of India & Ors. (2025), the Delhi High Court ordered the Customs Department to release the personal jewellery of a minor from UAE who had come to India to attend a relative's wedding. The Court perused a photograph, depicting that she used to wear the said pieces of jewelry since childhood and observed, “This Court has now pronounced several orders/judgments, following various judgments of the Supreme Court and this Court, wherein it has been held clearly that if the gold items seized are personal jewellery, the same would not be liable to be confiscated.”

In Dalvinder Singh Sudan v. Commissioner Of Customs (2025), the Delhi High Court set aside the detention of a Dubai resident's gold kada by the Customs, holding that he was Sikh by religion and such persons usually wear kada as part of their religious practice, which could not be seized.

In Monish Kansal Through Spa Ritik Agnihotri v. Commissioner Of Custom & Ors. (2025), the Delhi High Court ordered the Customs Department to release the high-value Rolex watch of a NRI, holding that foreign tourists are allowed to bring into India jewellery even of substantial value provided it is meant to be taken out of India with them.

Following these case, the Department had notified (in April 2025) that insofar as travellers of foreign origin are concerned, personal effects including jewellery shall not be detained so long as the same are declared in the 'Red Channel' and the said travellers undertake to re-export the same.

Purity of gold jewellery no bar

In Mubina v. Commissioner of Customs (2025), the Delhi High Court held that it is normal practice in India that women wear basic jewellery such as bangles as part of their personal effects. The same can't be detained by the Customs Department only on the basis that the same were of 24 carat gold, unless any other special circumstances exist for such detention.

In Shamina v. Commissioner Of Customs (2025), the Delhi High Court granted relief to a woman whose 998 purity (equivalent to 24 karat) gold jewellery was treated as prohibited goods under the Baggage Rules 2016, and absolutely confiscated by the Customs Department on her return to the country.

Pre-printed form for waiver of Show Cause Notice

Section 124 of the Customs Act contemplates issuance of a show cause notice before confiscation of goods by the Customs department.

In Amit Kumar v. The Commissioner of Customs (2025), the Delhi High Court came across a case where the passenger claimed that no SCN was issued to him whereas the Customs contended that an oral SCN was given to the Petitioner, who also signed an undertaking that he does not want a written SCN or even a personal hearing.

Shunning such practice, the Court had held that waiver of show cause notice and personal hearing by a passenger, obtained by the Customs on a Standard Performa, would be contrary to law.

Similarly in Mohamed Shamiuddeen v. Commissioner Of Customs & Ors. (2025), the Delhi High Court reiterated that authorities making a traveller waive show cause notice before confiscation of goods, etc. under Section 124 of the Customs Act, on a mere proforma, is not lawful.

“If an oral SCN waiver has to be agreed to by the person concerned, the same ought to be in the form of a proper declaration, consciously signed by the person concerned. Even then, an opportunity of hearing ought to be afforded, inasmuch as, the person concerned cannot be condemned unheard in these matters. Printed waivers of this nature would fundamentally violate rights of persons who are affected,” it had said.

Following this, the Department had filed an affidavit in Court, undertaking that proformas were done away with and if notice is waived by any passenger, notice of personal hearing would be given to the concerned passenger through WhatsApp, email ID as also through the authorized signatory. Passengers will also be duly informed about the applicable provisions in respect of issuance of an oral SCN and the procedure thereto.

Detention Receipts

Under the Baggage Rules, a person whose goods are detained has to be issued detention receipts which would bear the time and date of detention, number of items seized and the net weight of the said items.

In Anjali Pandey (supra), the Delhi High Court had also issued directions for issuance of proper detention receipts to an affected passenger. It had directed:

i. Detention receipt should contain contact details of the tourist including email address and mobile/ WhatsApp number;

ii. Coloured images of the gold ornaments/ jewellery detained from the tourist should be attached to the detention receipt;

iii. Copy of the said images should be provided to the concerned tourist and the same shall also be retained on record of the Customs Department.

Similarly, in Mohammad Arham v. Commissioner Of Customs (2025), the Delhi High Court held that detention of goods by the Customs Department cannot continue beyond a period of one year, if a show cause notice was not issued to the assessee within such period. The Court cited Section 110 of the Customs Act which prescribes a period of six months and a further extension of six months for the Department to issue a show cause notice.

In Chaganlal Gainmull v. Collector of Central Excise (1999), the Supreme Court held that if the SCN was not issued within six months from the date of seizure the consequence would be that the person from whom the gold was seized would become entitled to its return.

Communication of notices, orders passed by Adjudicating Authority under Customs Act

Section 153(c) of the Customs Act empowers the Department to serve notices to passengers through email.

In Bonanza Enterprises vs. The Assistant Commissioner of Customs & Anr. (2024), the Delhi High Court was confronted with a case where the show cause notice (SCN) forming the basis of the impugned order was never received by the Petitioner. Thus, no reply to the SCN was filed and no hearing was actually held.

Consequently, the Court had called upon the Department to send notices via email, in addition to service by speed post, registered post or courier.

Four months later, the Customs decided that once the adjudicating order is passed, the same shall be communicated on the email address of the passenger and on Whatsapp number, with a clear note that the passenger is free to challenge the same within 90 days (60 days + 30 days).

Conduct of Customs Department

In Zhinet Banu Nazir Dadany v. Union Of India & Anr. (2019), the Delhi High Court directed the Customs authorities to pay Rs. 93,34,783 to a Kenyan national, whose gold was confiscated and sold off by it without issuing show-cause notice.

"There is no explanation offered by the Respondents as to why they were constrained to dispose of the seized gold, when it was neither perishable nor hazardous. Also, there is no answer why it had to be disposed of without notice being issued to the person from whom it was seized present case", Court had said.

In Gor Sharian v. The Commissioner Of Customs (2025), the Delhi High Court slammed the Customs Department for disposing of the gold seized from a Russian national, despite an order of the Commissioner for its release.

The Court had held that the Department must ensure that the intimation of disposal of detained or confiscated property is given to the concerned party both via email as also the mobile number. This will ensure that a party who succeeded in Court or Tribunal against the detention of the property is not deprived of their properties, it had said.

In Ashiya v. Commissioner of Customs (2025), the Delhi High Court was faced with a case were the gold bangles of a woman were withheld by the Customs despite an order of the Adjudicating Authority, directing release.

The Court had held that merely because the Department plans to seek a review of the order for return, is not grounds to withhold the return of seized articles.

In Mushlina v. Commissioner Of Customs (2025), the Delhi High Court flagged the Customs Department's regular non-appearance in an appeal preferred by an aggrieved traveller whose articles were confiscated at the airport. The passenger further faced consistent non-implementation of the relief orders passed by the Appellate Authority, it said. The Court further noted that in cases where the Department prefers revision against the appellate order, like in this case, it does not keep the traveller in the loop, making them wait endlessly.

When Courts cautioned travellers

Apart from keeping the Customs Department in check through above mentioned judgments, the Courts also struck a balance in reminding the passengers of their duties.

For instance, in Mohit Mann v. Union of India (2025), the Delhi High Court made it clear that under the garb of attending weddings where wearing gold jewellery is a common affair, a foreigner cannot be permitted to bring half kg gold jewellery to India.

It was dealing with a case where a US citizen brought 17 high value mobile phones (iPhones) to India and walked through the green channel, before he was intercepted by the Customs officers.

In Sanchit Gupta v. Commissioner Of Customs (2025), the Delhi High Court imposed costs on two persons who had returned from Dubai with 200 grams gold jewellery, for falsely claiming that their old gold jewellery was seized by the Customs Department. On production of the gold items before it, the Court had noted that they are not used gold jewellery of the Petitioners but rather brand new jewellery.

In Myratgeldi Mammedov v. Union Of India & Anr. (2025), the Delhi High Court refused to entertain the writ petition moved by a Turkmenistan national, alleging that the Indian Customs Department had illegally arrested him in connection with alleged gold smuggling back in 2018.

The Court noted that the Department had produced the seized gold jewellery in a sealed cover and the same, upon inspection, could not be termed as 'personal effect' of the Petitioner.